30 January 2023 – Has the greed for scrap now broken out in Europe? How the EU steel lobbies are positioning themselves in the green shadow of the wind energy producers to whose demise they have contributed for years. Washington wants to appeal against the WTO panel decision on steel and aluminium tariffs. And Europe soon to bring up the rear in renewable energies? Hydrogen investments only at 0.1%? EC to impose new anti-dumping duties on stainless steel from Turkey.
U.S. Government to appeal WTO Panel Rulings
Already on Friday, U.S. Ambassador María Pagán announced in a statement that the United States will appeal against the rulings of the WTO DSB Panel on certain measures on steel and aluminium products (DS552).
No end in sight for Section 232
Washington has now also made it clear that lifting the Section 232 tariffs on certain steel and aluminium products is out of the question for the United States. And will refer this decision to the WTO Appellate Body.
Appellate Body blocked
However, the Appellate Body has been unable to act for some time due to the blockade by the United States. In her statement, Ambassador Pagán even refers to the urgently needed reorganisation of the Appellate Body, but when this could happen is not mentioned.
EU and U.S. clear the air
After the EU had already updated its Safeguard measure in 2023 on certain steel products, the U.S. Section 232 measure is now also likely to remain in place until further notice. At least until the EU and the US have agreed on a possible joint market protection measure for steel.
Greedy for scrap – now also critical raw material?
Since the general mobilisation in the propaganda department of the EUROFER, even the last EU parliamentarian should have realised that at least some of the European steel producers have become greedy for scrap. The media offensive under the green-washed cloak of environmental protection with regard to the new EU Waste Shipment Regulation has hardly escaped the attention of anyone in the industry.
Scrap export ban not to EUROFER’s full satisfaction
However, after the goal of a complete scrap export ban could not be achieved by EUROFER, an ally was sought in WindEurope, the umbrella organisation of European wind turbine manufacturers and operators, which desperately needed some heavy verbal artillery and a strong ally in the EU’s neglected quest for green transformation. In recent years, the expansion in wind power had stalled.
Now scrap as Critical Raw Material?
Now EUROFER, together with WindEurope, wants to get scrap metal included in the EU Critical Raw Materials List. For a few days now, the media drumfire regarding this list has been increasing on the part of the two associations. Two partners who could hardly be more different are standing shoulder to shoulder here. After all, the expansion of wind energy in Europe has failed for years due to the lobbying of the industries whose help they are now so obviously happy to accept.
Internal power struggle between steel lobbies?
At the same time, there seems to be disagreement within the European steel producers and their associations about the direction of green steel production. At the end of last year, the powerful German Steel Federation, which is a member of EUROFER, presented its proposal for the framework conditions for the production of green steel. And in it, it made the assumption that the production of steel – not only for the BF/BOF route, but also for the EAF route – would continue to be based on a share of 80% raw materials and 20% scrap. Even if enough DRI/HBI could be procured at some point.
80% raw materials or 90% scrap?
In contrast, the efforts of EUROFER and the statements of the EU stainless steel producers, for example, show that they are fighting for a share of 90 to 100% scrap in the raw material mix. This would also be logical, as EAF producers are currently not in a position to achieve the EU benchmark values for GHG emissions.
EAF manufacturers vs. BOF manufacturers?
This generally points to an internal power struggle between EAF and BF/BOF manufacturers. After all, 70% of the German steel industry still produces on the classic blast furnace route. And with a share of more than 40 million tonnes per year in steel production, Germany clearly dominates the EU market.
Steel producers fail to adapt for almost two decades
The unwillingness of EU steel producers to adapt has been criticised for years. The German Federal Environment Agency, among others, has repeatedly stated in recent years that the free allocation of emission certificates leads to the beneficiary companies having no motivation to intensify their efforts to reduce GHG or CO2 emissions. Moreover, the allocation of the free certificates had been set far too high over a long period of time. For this reason, the certificates allocated free of charge are also described as indirect and as harmful to the environment.
But the EC continues to have nothing better to do than shower steelmakers with free carbon credits and other subsidies, even as they lack any will to adapt – for almost two decades now. With the drastic increase in prices for ETS certificates, the surplus and free certificates were and are a double bonus for the steel producers.
Is WindEurope now fighting for EUROFER?
This also makes it clear why the new alliance between EUROFER and WindEurope seems strange, if not downright absurd. After all, the EU steel industry has contributed to the decline of European wind energy, especially in Germany, over the years with its lobbying. And it has pocketed billions in indirect subsidies at their expense.
Will Europe soon bring up the rear in green energy?
With the EU Green Deal and the Fit for 55 Plan, as well as the market protection measure CBAM, the EU and the European Commission have been making a big fuss for several years that the world would have to submit to Europe’s green aspirations and be asked to pay for them at the European external borders.
However, it is nothing new that the European Union is threatening to fail in its efforts to do so due to the internal lobbying of economic and political interests. And it is now also confirmed by a current BNEF study, which shows, for example, that investments in hydrogen are clearly lagging behind other technologies. Hydrogen still ranks last in global investment commitments and has a total share of just 0.1%.
Turkish stainless steel HRC to be subject to anti-dumping duty
Hot-rolled stainless steel products originating in Turkey are to be subject to a 17.3% anti-dumping duty at the EU’s external border, according to insiders. This is according to the European Commission’s disclosure letter on anti-circumvention case R778, which was brought to the attention of the parties involved in the case today.
Circumvention of anti-dumping measures against SSHR from Indonesia
According to the letter, at least one Turkish stainless steel producer is alleged to have participated together with a Southern European company in the circumvention of the anti-dumping measure against SSHR originating in Indonesia. Since the EC says it must assume that not only one producer was involved in the circumvention, all Turkish exporters are to be included in the measure. There are to be no exceptions. The final decision on this is expected in the coming weeks.
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